Tatton Asset Management Group revenue increases 12.6%

Asset Management

Tatton Asset Management plc (LON:TAM), the investment management and IFA support services group, has announced its interim results for the six-month period ended 30th September 2020.

FINANCIAL HIGHLIGHTS

– Group revenue increased 12.6% to £10.956m (Sep 2019: £9.729m)

– Adjusted operating profit1 up 21.9% to £5.030m (Sep 2019: £4.126m)

– Adjusted operating profit1 margin 45.9% (Sep 2019: 42.4%)

– Reported profit before tax £3.074m (Sep 2019: £3.610m)

– Adjusted fully diluted EPS2 increased 21.5% to 6.55p (Sep 2019: 5.39p)

– Interim dividend up 9.4% to 3.5p (Sep 2019: 3.2p)

– Strong financial liquidity position, with net cash of £13.328m

– New banking facility, giving access to up to £30 million of funds, to support growth

1.                    Adjusted for exceptional items, share-based payment costs and amortisation

2.                    Adjusted for exceptional items, share-based payment costs, amortisation and potentially dilutive shares

OPERATIONAL HIGHLIGHTS

– Assets Under Management (AUM) increased 17.4% to £7.811bn (31 March 2020: £6.651bn), an increase of £1.160bn for the six-month period. Latest AUM mid-November 2020 is £8.134bn

– Net inflows for the six months to September 2020 were £328.1 million, an increase of 4.9% of AUM

– Tatton increased the number of firms utilising its Discretionary Fund Management (“DFM”) services by 4.9% to 624 (31 March 2020: 595) and the number of accounts increased 3.6% to 68,500 (31 March 2020: 66,100)

– Tatton’s long-term business partnership with Tenet continues to develop well with 93 IFA firms (31 March 2020: 81 IFA firms) and AUM reaching £376.6m (31 March 2020: £225.9m)

– Paradigm Mortgage Services, the Group’s mortgage distribution and support services business, has seen an increase in member firms for the period of 3.0% to 1,591 members (31 March 2020: 1,544 members)

– Paradigm Consulting, the Group’s IFA support business, increased its members by 2.5% to 404 (31 March 2020: 394)

Paul Hogarth, Tatton Asset Management Chief Executive Officer, commented:

“I am pleased to report our interim results for the first half of this financial year. I am delighted to confirm that despite the exceptional circumstances of the last six months we have delivered a resilient performance with strong growth in revenue, profits and margins and remain on track to meet market expectations in FY 2021. 

2020 has been a testing time for all businesses and I would like to thank our colleagues for their incredible dedication and contribution during this time and our IFAs for their continued support and trust. Tatton is a proud advocate of IFAs; we place them at the heart of our value chain and recognise how essential the IFA remains to our distribution strategy. In response to changing conditions, it has been necessary to adapt the way we interact with our firms over the last six months. We have adjusted our approach from a predominantly in-person contact model to include web-based engagement, through a suite of online meetings and interactions led by the IFA’s own business model and capability.

As we move into the second half of the financial year, we recognise that there are headwinds in our industry but we remain enthused by the exciting opportunities that exist for the business and are optimistic regarding the prospects for the Group.”

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